Should You Think About Buying GMR Infrastructure Limited (NSE:GMRINFRA) Now?

GMR Infrastructure Limited (NSE:GMRINFRA), is not the largest company out there, but it led the NSEI gainers with a relatively large price hike in the past couple of weeks. As a well-established company, which tends to be well-covered by analysts, you could assume any recent changes in the company’s outlook is already priced into the stock. However, what if the stock is still a bargain? Let’s take a look at GMR Infrastructure’s outlook and value based on the most recent financial data to see if the opportunity still exists.

View our latest analysis for GMR Infrastructure

Is GMR Infrastructure still cheap?

Good news, investors! GMR Infrastructure is still a bargain right now. According to my valuation, the intrinsic value for the stock is ₹41.71, but it is currently trading at ₹26.35 on the share market, meaning that there is still an opportunity to buy now. GMR Infrastructure’s share price also seems relatively stable compared to the rest of the market, as indicated by its low beta. If you believe the share price should eventually reach its true value, a low beta could suggest it is unlikely to rapidly do so anytime soon, and once it’s there, it may be hard to fall back down into an attractive buying range.

Can we expect growth from GMR Infrastructure?

Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. GMR Infrastructure's earnings over the next few years are expected to increase by 80%, indicating a highly optimistic future ahead. This should lead to more robust cash flows, feeding into a higher share value.

What this means for you:

Are you a shareholder? Since GMRINFRA is currently undervalued, it may be a great time to accumulate more of your holdings in the stock. With an optimistic outlook on the horizon, it seems like this growth has not yet been fully factored into the share price. However, there are also other factors such as financial health to consider, which could explain the current undervaluation.

Are you a potential investor? If you’ve been keeping an eye on GMRINFRA for a while, now might be the time to make a leap. Its prosperous future outlook isn’t fully reflected in the current share price yet, which means it’s not too late to buy GMRINFRA. But before you make any investment decisions, consider other factors such as the track record of its management team, in order to make a well-informed buy.

Diving deeper into the forecasts for GMR Infrastructure mentioned earlier will help you understand how analysts view the stock going forward. Luckily, you can check out what analysts are forecasting by clicking here.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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